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Mortgage Market Guide: Housing Data Disappoints but Builder Confidence

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Mortgage Market Guide: Housing Data Disappoints but Builder Confidence High

  In This Issue  
     
 

Last Week in Review: Housing Starts, Building Permits and Existing Home Sales disappoint in August. However, builder confidence remains high.

Forecast for the Week: Will GDP and PCE by A-OK?

View: Sharpen your focus on communication via webcam.

 
     
  Last Week in Review  
     
 

“What a feeling.” Irene Cara. There were drops in key construction data and sales of existing homes, but builder confidence is high.

Fewer people began excavation on new homes in August. The Commerce Department reported Housing Starts fell 5.8 percent from July to an annual rate of 1.142 million units, below the 1.186 million expected. The South saw a decline of 15 percent, offsetting gains in the Northeast, Midwest and West. Starts on single-family homes fell 6 percent, while multifamily dwellings decreased by 5.4 percent.

Building Permits also were below expectations. This sign of future construction fell 0.4 percent from July.

Existing Home Sales also dropped in August, falling 0.9 percent from July to an annual rate of 5.33 million units, below the 5.50 million expected. The National Association of REALTORS® said higher prices and low inventories kept buyers on the sidelines. On a positive note, sales were up 0.8 percent from August 2015.

Another good sign: Builder confidence in September jumped to its highest level since October 2015 as reported in the National Association of Home Builders Housing Market Index. The Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months. The survey also asks builders to rate traffic of prospective buyers. All three components moved higher in September.

Meanwhile, members of the Federal Open Market Committee (FOMC) met to weigh data on jobs, price stability and economic growth as a whole. The FOMC left its benchmark Fed Funds Rate unchanged. This short-term rate is the rate at which banks lend money to one another overnight. Fed Chair Janet Yellen noted the decision “does not reflect a lack of confidence in the economy” but instead a “cautious approach” to strengthening the economy.

The great news for homebuyers and those looking to refinance is that home loan rates continue to hover in historically low territory.

If you have any questions about home loan rates or loan types, please don’t hesitate to contact me.

 
     
  Forecast for the Week  
     
 
Economic growth and inflation will be the hot topics in a data-rich week that includes housing, consumer attitudes and more.
  • Housing data begins on Monday with New Home Sales, followed by the S&P/Case-Shiller Home Price Index on Tuesday and Pending Home Sales on Thursday.
  • Consumer Confidence will be released Tuesday with the Consumer Sentiment Index on Friday.
  • Durable Goods Orders will be delivered Wednesday.
  • On Thursday, the final reading on second quarter Gross Domestic Product will be released along with weekly Initial Jobless Claims.
  • Look for manufacturing news via the Chicago PMI on Friday. Plus, Friday brings the latest news on Personal Income, Personal Spending, and the Fed’s favorite inflation gauge, Personal Consumption Expenditures (PCE).

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds were pushed higher recently, keeping home loan rates in historically low territory.

Chart: Fannie Mae 3.0% Mortgage Bond (Friday Sep 23, 2016)
Japanese Candlestick Chart
 
     
  The Mortgage Market Guide View…  
 
     
 

6 Ways to Raise Your Webcam IQ

Chances are you’ve used a webcam, but how confident are you that your webcam etiquette gives your viewers the best experience and helps you put your best foot forward? No matter how you use webcams in your career, these six tips can help polish your presence:

Distractions are deal killers. Clear the room, silence your phone, close out other computer applications that may ping or pop up, and close your door to help minimize intrusions. The more importance and focus you place on the other person’s experience, the better impression you’ll make.

Cut Clutter. If viewers can see you, they can see your office too. Make sure your background doesn’t create visual noise. Have a clean, decluttered background to leave contacts with a good impression of your professionalism and style.

Light and shadow. Make sure you are well lit from the front. If you’re overly backlit, it can appear as though you’re sitting in a darkened room, even if it looks well lit in person.

Chin up! Position your webcam, so you look slightly upward into the camera instead of downward. This may require a riser for your laptop. You’ll look more natural; plus it’s a healthier position for your neck!

The eyes have it. As tempting as it may be to look at the computer screen, take a cue from professional news anchors. Give the illusion of eye contact by looking at the camera as you speak, rather than at your image or the image of the person with whom you are talking.

Don’t be shifty. Don’t forget they can see you. Like with face-to-face communication, your posture and body language make an impression. So sit up straight, use simple hand gestures as you talk, and resist the urge to make unnecessary movements like head scratching, fidgeting or shifting in your seat.

The next time you find yourself sitting across from a webcam at home or in the office, try a few of these tips and you’ll make an even better impression!

Please feel free to pass these helpful tips along to your team, clients and colleagues.

Source: Fast Company

Economic Calendar for the Week of September 26 – September 30
Housing Data Disappoints but Builder Confidence High

 

 

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